Another weekly close above $30,000 means bitcoin is still primed to break through the all-important $31,000 resistance.
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Bitcoin's momentum is currently in its favor. Bitcoin Has More In The Tank
Bitcoin continues to hover near the $36,000 resistance level, which marks the second major attempt to surpass it. Momentum is currently in favor of bitcoin, with the potential to break through the barrier this time. The previous attempt was driven by a surge from $20,000, but lost momentum before reaching the crucial $31,000 level.
Momentum Indicators Move Higher
Bitcoin is currently facing resistance and moving sideways, possibly indicating an upcoming breakthrough. On the weekly timeframe, the Stochastic RSI momentum indicator is heading higher, which is considered an extremely bullish signal. On the lower timeframes, both the 8-hour and 12-hour have bottomed and are trending higher, while the daily timeframe is currently on the way down.
In April, when bitcoin was at these levels, all the timeframes were overbought, and the exhaustion led to a downward trend. However, bitcoin has now broken through the top of the bull flag formed since the last April rejection. Although it has not immediately shot up, it has followed a process of going back inside the flag and then sideways, indicating a potential for upward movement.
Is Bitcoin Such A Risk Asset?
Bitcoin's price may be waiting for a bullish news to break the current trend and increase its value. However, the traditional finance market remains mostly unchanged, and the possibility of a severe recession still looms. Some analysts predict that in the event of a market crash, Bitcoin will be the first to drop as investors divest from risky assets. Nevertheless, it can be argued that Bitcoin is the rarest asset in the world and the least correlated to traditional financial assets. In the current chaotic economic landscape, where governments resort to money printing to support their economies, Bitcoin could prove to be an extremely valuable asset.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.